Posted on May 16, 2014
When the unexpected happens to Georgia business owners - fire, wind or lawsuit - it can be pretty traumatic to deal with, and how much more disastrous if those companies do not have enough business insurance coverage or even worse still are completely without any insurance at all?
Commercial insurance plays a vital role in providing businesses with asset protection so that they can continue growing and building profits without worry when misfortune strikes. Gaining knowledge about the types of insurance available is important, but also understanding the actual amount needed will better serve Georgia businesses so they can purchase enough coverage to fully protect their hard work and financial investment.
Georgia Liability Coverage
Georgia business owners will want to carry enough general liability insurance coverage to protect their companies from financial losses resulting from injuries, death or property damage caused by their products, operations or employees. Large awards in a lawsuit can create financial challenges and possible catastrophic consequences to a business. Liability coverage will pay for legal defense and for damages that a business is being held liable up to the policy limits.
Most commercial liability policies cover two important areas of a contract: premises & operations coverage as well as products & completed operations.
· Premises & Operations - covers bodily injury or property damage for accidents on business premises or due to company operations.
· Products & Completed Operations - covers injuries from products made, sold or distributed by a company that are given to others off premises. It will also cover any claims that happen off site after operations are completed.
Some companies need additional protection over and above standard liability insurance coverage. This extra insurance is provided under an umbrella liability policy. Umbrella policies usually add $1 million to $5 million of additional coverage and are frequently used by companies that have significant assets to protect or are in a high risk industry.
Workers Compensation Coverage
All Georgia employers with 3 or more part time or full time employees are required to carry workers compensation insurance. This coverage may be purchased from private insurance companies licensed to do business in Georgia, through group self-insurance programs, with individual self-insurance or by enrolling in alternative programs sponsored by life and health insurance companies.
Workers comp insurance pays medical expenses and lost wage benefits for employee work related illnesses and injuries.
Georgia companies make large investments in their buildings, inventory and equipment. Commercial property insurance provides protection for structures, building contents and any other property owned by the business. Property insurance coverage is defined in two ways - as specific peril, or all-risk policies.
A specific or named peril policy covers specific events such as hail, fire, theft or wind. It will only cover events specifically named in the policy. Because it provides less coverage than an all-risk policy, it is usually less expensive. An all-risk policy covers any losses not specifically excluded by the policy. For example, if an all-risk policy states that wind is excluded, it will cover all other perils except for wind damage sustained by the property.
When purchasing property insurance, it may be purchased on a replacement cost or actual cash value basis. The value of a property less depreciation represents actual cash value coverage while replacement cost value means the cost to replace a building at today's prices. As time goes by, inflation increases the replacement cost of properties so for physical buildings, replacement cost coverage provides the most protection.
Companies that regularly use equipment off site or hold customer's personal property on premises require additional property insurance coverage called Inland Marine insurance. This insurance covers such business goods as building equipment, sales samples, animals and exhibits as well as dry cleaners and repair shops that receive customer's personal property.
Commercial Flood Insurance
Flooding occurs when people least expect it, and extensive flood damage to businesses can quickly rack up repair and replacement expenses for both buildings and business goods inside them. Coverage for flood damage is not included under most commercial property insurance policies. The National Flood Insurance Program administered by FEMA sells flood insurance to Georgia homeowners and businesses to provide this valuable insurance coverage. Companies can apply for up to $1 million in flood damage protection - $500,000 for buildings and $500,000 for building contents. Tenants that rent their business space may also apply for contents only coverage to insure their business equipment, documents, furniture and inventory.
Hurricane Insurance for Georgia
Businesses in the coastal regions of Georgia must concern themselves with the potential of hurricanes striking the area and causing significant damage and losses to property. While many commercial property policies cover damage caused by wind and hurricanes, companies located in high risk areas may need to add additional coverage to ensure that they are fully protected in the event of a major storm.
Additional Information on Georgia Insurance